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What are the legal implications of trading under a company name and style, as seen in the case of Cross, Hobson, & Company v.
Edward H.
Harrison?
The concept of a "company name and style" is a type of legal fiction, where a group of individuals trades under a single name, creating a separate legal entity.
This concept is rooted in the idea of "piercing the corporate veil," where the law treats a company as a separate entity from its owners, unless there's fraud or injustice involved.
The case of Cross, Hobson, & Company v.
Edward H.
Harrison was decided by the Supreme Court of the United States on May 23, 1854, setting a precedent for future cases.
Alexander Cross, William L.
Hobson, and William Hooper trading as Cross, Hobson, & Company brought an action of assumpsit against Edward H.
Harrison, showcasing the complexity of business relationships.
An action of assumpsit is a type of lawsuit where one party sues another for breach of contract or debt.
In this case, the plaintiffs claimed Harrison was responsible for some harmful action, demonstrating the importance of clear contracts and agreements.
The Supreme Court's decision in this case has been cited in numerous subsequent cases, influencing the development of contract and business law.
Trading under a company name and style can affect tax liability, as the company is considered a separate taxable entity.
The concept of "pass-through taxation" applies to some businesses, where the company's income is only taxed at the individual level, not at the corporate level.
In the United States, companies can choose to be taxed as a C Corporation, S Corporation, or Limited Liability Company (LLC), each with its own tax implications.
The legal implications of trading under a company name and style also affect liability, as company owners may be protected from personal liability for business debts.
However, owners may still be held personally liable if they engage in fraudulent activities or fail to maintain the "corporate veil."
In some cases, courts may "pierce the corporate veil" and hold owners personally liable if they find evidence of abuse or injustice.
The concept of a "company name and style" is essential for businesses, allowing them to establish a brand identity and build a reputation.
A company's name and style can also impact its creditworthiness, as lenders and investors may review a company's reputation and financial history.
In the context of international trade, a company's name and style can influence customs regulations and tariffs, as seen in the Cross, Hobson, & Company v.
Edward H.
Harrison case.
The concept of a "company name and style" is closely tied to the idea of "doing business as" (DBA), where a company operates under a different name than its legal name.
DBAs are often used to create a brand identity or to operate a business under a different name without creating a new legal entity.
In some jurisdictions, businesses are required to register their DBA with the state or county, while in others, registration is not mandatory.
The legal implications of trading under a company name and style are complex and multifaceted, requiring businesses to carefully consider their legal structure, contracts, and agreements.
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